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In many jurisdictions, limited partnerships are the preferred legal vehicle for structuring private equity, venture capital and other private capital funds. Investors typically commit capital as limited partners to a fund managed by a general partner, who is responsible for raising capital from the limited partners and managing the business of the partnership. The popularity of limited partnerships stems from advantages such as limited liability for the investors, contractual flexibility and tax transparency.
11 November 26
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As Uganda seeks to position itself as an attractive market for private capital, legal terminology must match legal substance. The current legal framework provides a suitable vehicle for private capital funds; however, the use of the label “limited liability partnership” for what is, in substance, a limited partnership creates avoidable confusion. Until the terminology is clarified, foreign private capital funds will need additional legal support to understand the Ugandan partnership structure. Harmonising this terminology with international standards will create the investor confidence required to grow the sector in Uganda.
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Should you have any questions regarding limited liability partnerships in Uganda, please do not hesitate to contact Edward Balaba or Laura Taaka.
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This article was first published in AVCA’s Legal and Regulatory Bulletin, Issue 12.